What is really going on with BlackBerry's smartphone business?

The thing about being number one in the market is that you always have to reinvent yourself over the years to stay relevant. Something similar happened to the once dominant smartphone player, the erstwhile BlackBerry. Their devices were used by everyone from the likes of Barack Obama, Hillary Clinton to personalities like Dustin Hoffman.

As per reports, BlackBerry is shutting down manufacturing of their smartphones and will depend on third party players to build and sell their phones. They are planning to transform into an enterprise software services player.

In an exclusive interaction with ETtech, Narendra Nayak, MD, BlackBerry India talks about their India plans, acquisitions and what the future holds for BlackBerry.

How have the last few quarters panned out for BlackBerry keeping in mind the recent earnings report?

In the last 18 months, we have gone through a significant transformation. We have pivoted ourselves from a device led company to a software services set up. We have become an open company from our days of offering just BlackBerry OS devices. We went to android because it gave us an opportunity to reach a wider audience.

Moreover, we made our BlackBerry enterprise server multi platform and open. We just want to increase our portfolio of solutions for a larger customer base. Our platform of products gives us the ability to offer a broader set of solutions to the market.

Our enterprise software revenue crossed our device revenue last quarter. Software has become a big contributor to this space. We have a very strong portfolio of IP and we monetize that IP .We have one of the largest patent portfolios in the world. The software and IP based revenue made our cash flow positive.

BlackBerry’s recent earnings report suggests that you are outsourcing your handset business and wholeheartedly entering the enterprise Software services segment. How have acquisitions help build your enterprise portfolio?

We have had ten straight quarters of positive cash flow. We are sitting on a healthy cash balance even after acquisitions. We are done with financial transformation. We are now in the execution and growth phase of the transformation.

To the same effect, we have made few critical acquisitions namely – Secusmart, Movirtu, WatchDox, AtHoc and Good technologies.

With Secusmart, we will venture into the secure voice space. Also, it has encrypted voice over IP and with its platform we launched an enterprise grade solution in the secure voice space. Then we had acquired a British company called Movirtu in the virtual sim space which helps one to run up to 9 numbers which will work as separate physical numbers. You need to register them separately with the carrier as different numbers.

Thirdly, we got hold of an Israel based organization called WatchDox which operates in the enterprise file sync and share phase. This will make our enterprise mobility management complete. It will help end customers share content within and outside of organization in a secure manner and yet keep control over the security of the document.

Also our acquisition of AtHoc will help provide services to government in case of urgent natural disaster situations where secure communication needs to be broadcasted to multiple end points.

Apart from this, we also got on board one of our competitors, Good Technologies 11 months back which is one of our largest acquisitions so far. We are in the last phase of our joint product integration.

Lastly, we acquired the UK based cyber security consultancy company called Encription which will help us enter high end penetration testing. This will help us be in the professional Cyber security services.

Does that mean you are re-imaging as a security player in the enterprise space?

The common thread around these acquisitions is around mobility and security. All these will work on a mobile platform because enterprises are using mobility to drive productivity but then security on mobile becomes that much more critical.

What does this mean for possible Indian customers?

In India, we are working towards redefining ourselves as a software company. We have hired eight to ten people in our pre sales team and also appointed HCL Infosystems as our new distributor focused purely on the enterprise software side of things.

Including our research and development outfit, we are about 30 people in total in India. Most of the new guys who have joined us come mostly from legacy software product companies and have around 12 to 15 years of sales experience.

The present team has pivoted to an enterprise strategy from a device distribution model. Our go to market will be completely partner and reseller driven. Most of the resellers are software resellers who have a specific focus on the security software phase. So these are people who have had clients like Fortinet, Palo Alto or McAfee who understand the security software phase.

It’s not that we will not be selling our phones. We will be selling it through stores but our focus will be majorly on the enterprise market.

Which verticals are you targeting with your new portfolio of solutions?

Now given our breadth of portfolio, each product will have different focus segments. BFSI will be a strong use case for our products. Our products like WatchDox will be of great use in the Pharmaceutical industry, wealth management companies or even in manufacturing. Also, AtHoc will be useful for companies like large steel plants, a large oil plant or a petroleum manufacturing company where employee health and safety is a concern.